Starbucks Corporation (SBUX), Green Mountain Coffee Roasters Inc. (GMCR), Panera Bread Co (PNRA): Retail Coffee Sector Still Brewing Strong

Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) also recently announced excellent second quarter results. The company had earnings of $1 billion, and revenues climbed by 13.5% compared to the same period in 2012. As java drinkers and investors know, revenue is the mother’s milk of future earnings growth and ultimately share prices as well.

Panera May Be Lagging

While Starbucks and Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) have exceeded analysts’ expectations this year, the same cannot be said for Panera Bread Co (NASDAQ:PNRA).

The cafe and bakery chain recently reported slower-than-predicted revenue growth. It appears that Starbucks’ successful launch of the La Boulange line may have taken a bite out of Panera Bread Co (NASDAQ:PNRA)’s breakfast line. In fact, the company had lower comparable store sales than originally forecast. This was blamed on a falling number of transactions and a spiral in sales of breakfast items.

At the same time Panera Bread Co (NASDAQ:PNRA) reported good news as the bakery chain opened 35 new stores in the second quarter (following the opening of 21 stores in the first quarter). And the company intends to open another 50 to 60 stores by the end of the year. Finally, while revenues came in slightly lower than anticipated – growing by 11% compared to the second quarter in 2012, this was a decline of 2% from the first quarter in 2013.

Premium Price for Latte?

In the end, while the second quarter has been profitable for Starbucks, Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR), and the retail coffee chain sector, investors should consider these coffee makers are selling at a premium. And for coffee lovers, there’s always the choice of buying a K-Cup brewer and enjoying your favorite cup of Starbucks brew at home.

Kyle Colona has no position in any stocks mentioned. The Motley Fool recommends Green Mountain Coffee Roasters, Panera Bread, and Starbucks. The Motley Fool owns shares of Panera Bread and Starbucks. Kyle is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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